'I want a £40k retirement income, but don't have a pension yet': Young workers warned lack of savings could be their 'big regret'

Young workers today regret the amount they spend on their credit cards and on nights out, but should perhaps turn their attention to the money they're not putting into their pensions and leading insurer has warned.

Standard Life says the youth of today should take note of the baby boomers over the age of 55s, who say that their biggest financial regret is not saving enough for retirement.

This was the main regret among 18 per cent of over 55s, despite them having had access to much more lucrative workplace pensions than younger generations, who will have to work harder to save what they need for retirement.

The folly of youth: Young people tend to regret how much they spend on nights out, rather than failing to save enough for retirement.

Those further from retirement find their focus lies elsewhere, with 35 to 44-year-olds saying their biggest regret is how much they spend on credit and store cards, while 18 to 24-year-olds think they spend too much on nights out and don't save enough.

Julie Hutchison, of Standard Life, said: 'The value in starting to save early is clear in terms of increased potential for growth.

'We also know from previous research that parents often find they need to de-prioritise their own saving when they are older, to help support their adult children with large expenditure such as university fees and deposits for their first homes.

'So trying to close up a savings gap later on in life can be really tricky. We should all learn from the experience of baby boomers and start saving as soon as we’re able to, so we don’t share the same regret when we’re older.'

Among the other financial regrets held by all adults was not setting and sticking to budgets, and not investing in a stocks and shares Isa.

Millions more young workers will be brought onto retirement savings schemes for the first time over the next four years as the Government's automatic enrolment programme is fully rolled out.

Tens of thousands more small and medium-sized businesses will reach their auto-enrolment staging dates this year.

'BUSINESS IS MY PRIORITY, BUT I STILL WANT £40K A YEAR IN RETIREMENT'

Will Odell wants £40,000-a-year.

Among those coming late to the pension saving party is 31-year-old Will Odell, of Kennington in London.

Straight after graduating from university in 2007, he launched his own business designing silverware, Will Odell Designs.

Such were the costs associated with running his own business, the silversmith found it difficult to save for more immediate needs like a mortgage, never mind for retirement.

But he has set himself some extremely ambitious retirement income goals and is now realising the task facing him.

He said: 'I have saved nothing into a pension so far, I have a very small amount saved to put towards a deposit, but it is an insignificant amount really.

'Ideally I would be putting money aside, but at this time I'm not in a position to save.

'In an ideal world I would like to have £40,000 for my retirement. Therefore I think I'd need to be putting away at least £1,700-a-month.'

Although at the moment the minimum amount enrolled members have to contribute is low at just 1 per cent of salary, matched by their employer for a combined 2 per cent, by 2018 this minimum will have risen to a combined 8 per cent.

Industry commentators have noted that in order for people to build up a decent sized pension pot for retirement, they will need to be saving more than 8 per cent of their salary, with many saying at least 15 per cent is required.

Pensions minister Steve Webb has previously said he is open to increasing the minimum, but this should not be considered until auto-enrolment has been fully rolled out.

But that's not to stop anyone currently in a workplace or personal pension from increasing the amount they contribute.

Ms Hutchison said: 'Our research shows that people are becoming better at managing day to day money, but are less smart when it comes to saving for the future.

'If you haven’t started saving towards your retirement, or if you started then stopped, the important thing is not to panic. It’s a matter of taking control, working out what you can afford and getting into a habit of saving regularly.

'And if you have been saving into a pension, but don’t know how much it’s currently worth, then take stock to see if you are on track for your retirement aims.'